by Patricia Ames
The Imaging Channel had the opportunity to sit down with Toshiba America Business Solutions President and CEO Scott Maccabe and have a fascinating discussion involving buffaloes, unicorns, big stadium deals and the changing world of information consumption. Join me in the SpeakEasy.
We both graduated from the same University — University of Colorado, Boulder. Go Buffs! What was your major?
Molecular Biology. It was a great school and there was a lot of excellent skiing involved.
I will admit that I had more fun than I should have, but I did graduate with an economics degree, so let’s talk a little about the economics of our industry. How would you assess your first year at Toshiba as President and CEO?
I think that fortunately I’ve been at the reins when our organization is really on the uptick and doing well.
It’s a nice curve!
Yes! We’ve been successful in MPS. We’ve been successful now for two years in digital signage. This last year, we’ve really had a focus on digital signage and we’ve been supporting it, and I think that’s been very successful. In addition, the depth of the relationship that we’ve been able to develop with Japan corporate has grown exponentially. Toshiba Corporation has two investigative investment arms – one in Japan and one in the U.S. In my previous role, I was a part of the U.S. investment arm. We took positions in several emerging technology companies. Now that I am overseeing Toshiba America Business Solutions I am able to create a bridge between our companies and leverage the investment holdings to find applications in our market. There is now an entirely different level of sensitivity within Toshiba corporate and my parent company, Toshiba Tec Corporation because I was able to create that bridge. Headquarters has realized that our dealer partners have access to hundreds of thousands of customers in all kinds of vertical markets. Toshiba has a large array of solutions that could be brought to our market. There’s a huge amount of energy from Toshiba corporate now pushing this at the Chairman and President level.
Are you seeing some trends in the channel?
There is definitely a push towards solutions. As an example, Toshiba is investing in data analytics development companies and also has a cloud company that is developing storage-based cloud solutions. We’re now holding meetings where corporate is asking us how we can take these solutions to the market, because they are the R&D organization and don’t have the paths to the market that we do. We are now aligned to do that.
That’s the unicorn! You’ve been able to find those elusive synergies everyone always talks about but rarely realizes. What do you see as one of the biggest challenges right now that you are working with?
I think there are so many different solutions in the market that one of the biggest challenges is really getting to our dealer base and helping them to understand which solutions are the right fit for them; to analyze how they line up with their needs and their skillsets. There are lots of partners and lots of options out there. It’s important to really step back and understand what the depth of those options is and how they fit or don’t fit with your organization and then understand what partners you should take to the dance. It’s also important to evaluate whether they are still going to be there to dance with you later. Dealers need to question whether the potential partner has good resources; do they have good R&D skillsets? If the partners don’t come from the IT space, for instance, they are going to need to go try to gain that knowledge — or buy it — and then try to integrate it without killing it and the creativity of it. That’s a completely different challenge to tackle. I think Toshiba has a distinct advantage longer term with our dealer partners because of our diverse and extensive background in IT as well as imaging.
So not only is it a challenge, it’s an opportunity for Toshiba.
Let’s talk a little bit about R&D, because it is vitally important in the bigger picture of staying ahead of the curve in a rapidly evolving channel.
Every R&D organization has a belief system that’s tied into the fact that their value is in what they create. The challenge is to link the voice of the customer and the marketing demand with the skillset to develop it. I have to tell you that Toshiba is a little bit unique – they aren’t as stoic of a Japanese R&D engineering organization as other ones I’m aware of, and they really want to understand what’s going to be successful and so they really do listen. I give kudos to our marketing organization. Corporate has been very aggressive in communicating that they want to have product development dynamically integrated with what we are seeing in the channel, and in making sure the messaging cycles back to driving the development in Japan. That’s a huge culture change, and that understanding and appreciation has reflected a representative value that the Toshiba R&D group has attached to our organization. They have confidence in our organization; they see the value in what we are doing. At our annual dealer event, LEAD, I had marketing and engineering development management leadership from Japan meet with our dealer partners so they could understand what is going on in the channel, and they continue to constantly engage.
That should end up being quite a strategic advantage. Given that many of the major OEMs in our channel are located overseas, there are some gaps that need to be bridged. Mastering a good flow of communication could be a huge differentiator.
It translates into driving the voice of the market and the customer through Japan rather than Japan developing what they think is a need in the market and fulfilling it back, and maybe not aligning it appropriately.
Where are you investing the most in your company this year?
We’re definitely expanding our professional services. We are looking at additional solutions that can be brought to market. We just recently announced our eBRIDGE CloudConnect application and are going to continue to expand on that. Most people might not realize that once you have this type of solution, you can get into predictive failure analysis and all sorts of other opportunities to really provide value to our dealers that they can then develop as a revenue stream to their customer base. We are going to continue to invest in doing the research and focus on these areas of opportunity.
Is it the intent that the solutions are packaged in a bundle with an equipment purchase, or could they also be sold on their own?
Well, they can be both. To tell you the truth, that’s the kind of conversation we are going through right now. We just had a road show showcasing our e-commerce solution and capabilities. The feedback from the dealers indicated that they see these types of applications as a way to create revenue and offer a higher level of service support to their customers. You then have to balance what is offered as a part of your service package and what is offered for an additional fee. Our intent is to continue to evolve the sophistication of our products so that the applications can be something that we either market as part of the package or as a separate solution. Our solution can actually be part of our competitors’ platforms too. Right now we’d rather offer it as a competitive advantage for our hardware, but eventually it could be something that we sell to the general market. For instance, a dealer who is in an environment where he has machines in field (MIF) control could use the solution on the Toshiba MIF and also on competitor MIFs, which may allow him to be more successful.
It’s been a crazy six years or so in the channel — there has been a major recession, industry consolidation, contracting markets, converging channels and a decline in print volumes driven mainly by technology, just to name a few of the major factors influencing our market. Just the way information is now consumed in the U.S. in the past few years has changed dramatically. How does Toshiba corporate view what has gone on in the U.S. and its transition?
It’s almost a dichotomy of influences because in Japan, they embrace technology even quicker than in the U.S. They have a really clear understanding that print volume in general is on the decline and it is completely concerning to them. They are very focused on looking beyond that market segment to understand the whole experience of information and content interaction, knowing that the print platform is one vehicle and information management and collaboration are another. Toshiba has experienced this on the computer side recently and they have experienced it in other technology platforms, so it’s not foreign to them.
Corporate is very engaged and very synchronized and very understanding of the dynamics of our markets and looking to find the best ways to help offset any declines. Toshiba corporate has a real sense of ownership with our dealer base. If you go back and look through the history of Toshiba, Toshiba as a corporation was built on partnerships, it’s a philosophy. They get the value of partnerships and really take it to heart that they’ve got to find solutions to keep the partners engaged.
Last year at your annual dealer event, LEAD, digital signage was the belle of the ball. How is that business developing for Toshiba?
In the last six months digital signage has really taken off! As an example, we have one grocery partner that has over 2,000 stores. They understand the power of the digital signage opportunity and they really want to dial it in. It’s wonderful to watch the momentum in this space. But it is not just about the equipment. There’s another company that we are starting to take a financial position in that creates digital signage content and can serve as a content engine.
That’s the key for digital signage, right?
Yes. You want to be able to protect the IP and you want to be able to control the development.
Where are you seeing the most traction right now in digital signage?
Our greatest momentum initially seems to have been in the sports and entertainment vertical.
I did see some press releases where you have secured some great stadium contracts.
We just inked a deal where we are the official electronics provider and a founding partner for the Staples center by AEG. As the exclusive supplier of digital signage and displays for the arena, Toshiba will supply Staples Center with more than 800 displays while receiving interactive digital signage, multimedia content, venue and affiliate product placement, as well as a comprehensive social media program with the Los Angeles Kings to enhance fan experience. AEG is the preeminent global sports management company; they are also going to build a half-billion dollar sports entertainment venue in Las Vegas tied to the MGM and we are working with them on that as well. We’ve seen a pick up in that space primarily because there was a lot of pent-up demand and a need to refresh.
Now we see in the retail space some significant growth happening and we are trying to take that and drive it further through the small and medium-sized business so we can really put together end-to-end solutions and turnkey packages for our dealers. Our dealers have more feet on the street, they’re more connected to the market segments and they are absolutely the best vehicle to drive this. It’s not that difficult of a solution set for them to naturally take in because it is an evolutionary product set. There is a quick path from learning and understanding the value proposition to successfully selling the product in the market. Toshiba can offer an additional layer of expertise to the sales process. We’ve asked our dealers to take a look at where they are most successful in their own market segments — which verticals? Where is there opportunity? We want to brainstorm with them on how we can put together solutions for their markets. We will assist in helping to target them together.
I am constantly amazed at the ability of the dealers to become deeply entrenched in very specialized verticals.
Yes and Toshiba can help them gain additional vertical expertise. As an example, Toshiba Medical is an entirely separate company within the overall Toshiba organization and they manufacture CT scanners and operate within very large health environments. We recently worked in partnership to secure a large contract in the retail vertical in supermarkets because of the scanning technology.
Think about digital signage in the healthcare vertical. There are limitless opportunities for a better user experience when there is the ability to access information and have interactive communication. A lot of dealers are already active in the healthcare vertical and digital signage provides a whole new avenue of revenue generation within this vertical for them.
If your customers were going to describe your company in three words, what do you think they would be?
Supportive, easy to do business with, loyal. We try to bend over backwards to take care of our customers and we take it personally that they are happy. Truthfully, one of the most impressive things that I’ve learned about this organization is that our dealers love us and it is because they believe that we are loyal, they believe that we are honest and that we have their best interests at heart. What more could you ask?
I commend the culture of our organization and truthfully it goes all the way back to Japan. They are great. I’ve been really impressed with how open-minded Japan is, as well as the rest of the organization, and we’ll continue to grow together.
Which word or phrase do you most overuse?
“Mutually beneficial.” I can’t stop using it. It’s all about being mutually beneficial in everything we do. Both parties must get something out of it. Both parties have value in whatever the relationship is.
So what are you most excited about going forward?
Our annual dealer conference, LEAD, is coming up and it will be a great platform for us to be able to continue to take the end-user experience and our dealer-related end-user experience to a different level. The dealers will be able to engage with Toshiba manufacturing and also the solutions that we’ve created.
What I am most excited about though is this evolution with digital signage. The opportunity is so compelling and interactive. There are amazing efficiencies that can be realized when digital signage is incorporated into the business model. They can serve as additional personnel without all the costs associated with that.
In the end, it’s still about communicating a message. Words and pictures are connecting points for human beings, it doesn’t matter what medium it is, the message has to be communicated and you have to have vehicles to do that.
I really think it is going to cross a whole new level of content creation, content interaction, and require different levels of content management. I don’t even think we are scratching the surface of it.
As a member of the media world, anything that involves content creation makes me happy!
And that’s what is going to facilitate business intelligence to an exponential level. It’s almost a self-fulfilling circumstance where it’s going to just continually be self-productive. Understanding where the message is coming from, understanding what’s behind the message is just as important as the actual message.
On the web: Toshiba America Business Solutions
This article originally appeared in the October 2014 issue of The Imaging Channel.